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2 What Do We Know? There is a Farm Bill and it has been signed into law Agricultural Act (AA) of 2014 It is over 930 pages long Will likely be over 20,000 pages long after USDA has written implementation rules for all programs

3 Disclaimer Information provided here is based on my reading of the Bill and other available materials regarding the contents of the Bill There may be differences in my interpretation and final regulations

4 Major Highlights What is not in 2014 Farm Bill? Direct Payments (gone) ACRE Program (gone) Countercyclical payments (gone, but not really; PLC is very similar) SURE Program (gone) Dairy Price Support Program & Milk Loss Contract (gone)

8 Agricultural Risk Coverage (ARC) County ARC or Individual ARC County ARC Payments when county actual revenue for covered crop < county ARC Revenue Guarantee County ARC Payment based on 85% of Base acres Individual ARC payments when actual individual crop revenues (summed across all covered commodities) are less than ARC individual guarantees (summed across all covered commodities) Individual ARC Payment based on 65% of Base acres

9 PLC or ARC? All producers on the farm must make a one-time, irrevocable decision (through the life of the bill) among PLC, County ARC & Individual ARC PLC & County ARC can be made on a coveredcommodity-by-covered-commodity basis Country ARC commodity ineligible for PLC & SCO Individual ARC applies to all covered commodities Ineligible for PLC & SCO

11 Shallow Loss Programs Supplemental Coverage Option (SCO) Area triggered (based on expected county yield or revenue) Triggered if area loss exceeds 14% of expected value of crop but not > deductible Must be purchased with an underlying individual crop insurance policy

14 Take Home Messages 2014 Farm Bill programs are complex Lots of decisions (& interactions) to think about! Consider your price and yield expectations over the life of the bill Do you expect price to be below or above ref. price? Do you expect yields to be below average or average? Are your yields correlated with county yields?

15 Take Home Messages Producers may need to rely on decision tools for these complex choices Texas A&M tool may be best for our area: https://decisionaid.afpc.tamu.edu/ Key deadlines: Base re-allocation: February 28, 2015 ARC/PLC choice: March 31, 2015

18 Texas A&M Decision Tool Data collection and data entry is going to be, by far, the most time-consuming part of the decision process, as you will see in what follows. But you only have to do it once!

THE 2014 FARM BILL: Overview & Major Highlights Rod M. Rejesus Associate Professor and Extension Specialist Dept. of Ag. and Resource Economics NC State University What Do We Know? There is a Farm Bill

ARC/PLC Program Overview FSA and University of MN Extension Producer Meetings December 2014 January 2015 The 2014 Farm Bill provides the following: Eliminates DCP and ACRE program Allows for a one-time

U.S. crop program fiscal costs: Revised estimates with updated participation information June 2015 FAPRI MU Report #02 15 Providing objective analysis for 30 years www.fapri.missouri.edu Published by the

Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisions. The risk of loss in trading futures, options, forward contracts, and hedge-to-arrive can be substantial

CURRENT LAW SENATE AG COMMITTEE (S. 954) HOUSE AG COMMITTEE (HR 1947) Reported out of Committee 15 5 Reported out of Committee 36 10 Cost $979.7 billion over the 10 years before sequester reductions of

From Catastrophic to Shallow Loss Coverage: An Economist's Perspective of U.S. Crop Insurance Program and Implications for Developing Countries Robert Dismukes Agricultural Economist Insurance coverage:

Analysis of the STAX and SCO Programs for Cotton Producers Jody L. Campiche Department of Agricultural Economics Oklahoma State University Selected Paper prepared for presentation at the Agricultural &

JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE The managers on the part of the House and the Senate at the conference on the disagreeing votes of the two Houses on the amendment of the House

STAX Stacked Income Protection Plan Don Shurley Professor Emeritus of Cotton Economics Department of Agricultural and Applied Economics University of Georgia Making Decisions and Understanding the 2014

Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisions. The risk of loss in trading futures, options, forward contracts, and hedge-to-arrive can be substantial

Crop Insurance for Cotton Producers: Key Concepts and Terminology With large investments in land, equipment, and technology, cotton producers typically have more capital at risk than producers of other

Revenue Implications of the New Farm Bill Nick Paulson npaulson@uiuc.edu University of Illinois The Profitability of Illinois Agriculture: Where to from Here? Presentation Outline Progress on the new Farm

The ARMtech ADVANTAGE Farm Bill Update Little has changed over the last month with respect to the 2012 Farm Bill currently under consideration by Congress. Though the Senate voted on and then passed its

Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisions. The risk of loss in trading futures, options, forward contracts, and hedge-to-arrive can be substantial

Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisions. The risk of loss in trading futures, options, forward contracts, and hedge-to-arrive can be substantial

United States Government Accountability Office Report to Congressional Requesters March 2015 CROP INSURANCE Reducing Subsidies for Highest Income Participants Could Save Federal Dollars with Minimal Effect

Group Risk Income Protection James B. Johnson and John Hewlett* Objective Analysis for Informed Agricultural Marketing Policy Paper No. 13 July 2006 Decision Making * University of Wyoming, Extension Educator

Multiple Peril Crop Insurance Multiple Peril Crop Insurance (MPCI) is a broadbased crop insurance program regulated by the U.S. Department of Agriculture and subsidized by the Federal Crop Insurance Corporation

Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisions. The risk of loss in trading futures, options, forward contracts, and hedge-to-arrive can be substantial

Questions and answers from Session 2 Managing Margin Risk 1. Could you elaborate more on the up to 150% of a county yield option on GRP and GRIP plans? What are the advantages and additional costs associated

Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisions. The risk of loss in trading futures, options, forward contracts, and hedge-to-arrive can be substantial

2010 The New ACRE Program: Costs and Effects By Brian C. Briggeman, Economist, Federal Reserve Bank of Kansas City and Jody Campiche, Assistant Professor, Oklahoma State University In 2010, many farmers

Farm Service Agency Annual Policy Reminders Farm Service Agency works hard to get information to you in a timely manner regarding our programs and policies. This document provides a list of important FSA

OVERVIEW The 2014 Farm Bill was signed into law on February 7, 2014, after three years of debate, negotiations and uncertainty. The previous farm bill, which was passed in 2008, expired in 2012, was extended

September 2010 Crop Insurance: Background Statistics on Participation and Results FAPRI MU Report #10 10 Providing objective analysis for more than 25 years www.fapri.missouri.edu This report was prepared

GAO March 2012 United States Government Accountability Office Report to the Ranking Member, Permanent Subcommittee on Investigations, Committee on Homeland Security and Governmental Affairs, U.S. Senate

CORN BEST MANAGEMENT PRACTICES CHAPTER 7 Insuring Corn in South Dakota Matthew Diersen (Matthew.Diersen@sdstate.edu) Crop insurance is an important component for managing production and economic risks.

CROP INSURANCE FOR NEW YORK VEGETABLE CROPS Multi-peril crop insurance is a valuable risk management tool that allows growers to insure against losses due to adverse weather conditions, price fluctuations,

Appendix A. A Nonstochastic Comparison of Price- and Revenue-ased Support efore planting, the producer can only guess at harvested yields and harvesttime prices due to their stochastic nature (that is,

Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisis. The risk of loss in trading futures, optis, forward ctracts, and hedge-to-arrive can be substantial

Managing Risk in Production Agriculture New Tools, Best Practices, and What We Are Seeing David W. Bullock, Ph.D., Senior Economist Mid American Cooperative Education Credit Conference, Indianapolis, October

Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisions. The risk of loss in trading futures, options, forward contracts, and hedge-to-arrive can be substantial

CROP COSTS Department of Agricultural and Consumer Economics University of Illinois Revenue and Costs for Corn, Soybeans, Wheat, and Double-Crop Soybeans, Actual for 2010 through 2015, Projected 2016 and

December 2012 ICTSD Programme on Agricultural Trade and Sustainable Development The 2012 US Farm Bill and Cotton Subsidies An assessment of the Stacked Income Protection Plan By Harry de Gorter, Cornell

United States Department of Agriculture Economic Research Service Economic Research Report Number 84 December 2009 Factors Influencing ACRE Program Enrollment Andrea Woolverton Edwin Young ww w o Visit

CROP BUDGETS Department of Agricultural and Consumer Economics University of Illinois CROP BUDGETS, ILLINOIS, 2015 Department of Agricultural and Consumer Economics University of Illinois September 2015

New Issues with Crop Insurance for Diversified, Sustainable and Organic Farmers Jeff Schahczenski, Agricultural Economist National Center for Appropriate Technology Farming as if People Matter Farm & Food

LGM-Dairy: A New Risk Management Tool for California Dairies Brian W. Gould Associate Professor Department of Agricultural and Applied Economics and University of Wisconsin Extension University of Wisconsin-Madison

Disclaimer: This web page is designed to aid farmers with their marketing and risk management decisions. The risk of loss in trading futures, options, forward contracts, and hedge-to-arrive can be substantial

The 2012 Farm Bill: A Comparison of Senate- Passed S. 3240 and the House Agriculture Committee s H.R. 6083 with Current Law Ralph M. Chite, Coordinator Section Research Manager July 23, 2012 CRS Report

University of California July 2007 Agricultural Issues Center AIC Farm Bill Brief #1 The Farm Bill and California Food and Agriculture* Daniel A. Sumner** Every five years or so the United States reconsiders

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